Fitting Facts to the Narrative at The Washington Post

From a Washington Post story headlined “Apple Is Behind in AI and Killed Its Self-Driving Car Project. What’s Next?”:

The company’s Greater China region, which encompasses mainland China, Hong Kong, Macao and Taiwan, has long been one of Apple’s most crucial growth zones. But growing pressure from a handful local rivals — including Shenzhen-based Huawei, which surmounted U.S. sanctions aimed at slowing its advance in late 2023 by producing a smartphone with a domestically made processor — cut sharply into Apple’s market share in the region earlier this year.

Data from market research firm Counterpoint Research indicated that Apple’s sales in China dipped by nearly 20 percent in the first quarter of 2024, a shift that senior research analyst Ivan Lam attributed partially to “Huawei’s comeback.”

The full scope of the company’s decline in China became clear Thursday, when Apple reported an 8 percent revenue dip compared to a year earlier.

It’s inexplicable that the Post included a paragraph with projections from Counterpoint claiming iPhone sales in China were down 20 percent even after Apple reported its actual results for the quarter. Jason Snell, over at Six Colors:

Finally, I particularly enjoyed the exchange between Wells Fargo’s Aaron Rakers and Cook in which Rakers asked Cook to explain Apple’s results compared to the data reported by independent research groups that suggested iPhone sales were falling apart in China. Apple’s actual numbers weren’t that bad, and in fact, Apple trumpeted how well the iPhone was going in urban China.

“I can’t address the data points,” Cook said. “I can only address what our results are, and you know, we did accelerate last quarter. And iPhone grew in mainland China, so that’s what the results were. I can’t bridge to numbers we didn’t come up with.”

That’s about as savage a shade-throwing as you’ll get on an Apple analyst call.

iPhone grew in mainland China last quarter but even after Apple announced that — in a legally-binding context — they went with made-up projections from Counterpoint to fit their narrative that Apple is in trouble.

While I’m being grumpy, I’ll even take issue with the notion — which the Post leads with in its headline — that Apple is “behind in AI”? It is true that Apple doesn’t offer an AI chat product like OpenAI’s ChatGPT, Microsoft’s Copilot, or Google’s Gemini. But do we expect Apple ever to offer such a project? Apple doesn’t have a web search engine but no one is arguing that Apple is “behind” on search. (App Store search results quality is another issue.) Apple doesn’t offer turnkey cloud computing services like AWS or Google Cloud either. Are they “behind” on that? When it comes to the products Apple already sells, how are they “behind on AI”? Are iPhone users missing out on AI features available only to Android users? No. Are MacBook users missing out because Apple hasn’t added a dedicated AI key to their keyboards?

I get that people see AI as a frontier that is transforming the industry, and Apple hasn’t revealed any new plans or features yet. But I’d say Apple is silent on AI, not behind. When iOS and Mac users are missing out on features that are only available on other platforms, that’s when I’d say Apple is behind.

Monday, 6 May 2024